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Jack Kearns only invests in companies based in his metro area because he believes he is more familiar with these companies than Wall Street analysts.

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Jack Kearns only invests in companies based in his metro area because he believes he is more familiar with these companies than Wall Street analysts. He trades frequently whenever he feels the market is misjudging a company's value. Which behavioral mistake is making? Hindsight hias b. Illusion of control Mental accounting d Retretaversion 6. Which of the following is not a money market instrument? a. A eurodollar account b. A negotiable certificate of deposit Commercial paper, d. A Treasury bond 7. Short-term borrowing by dealers in government securities is: a Repurchase agreements. b. Banker's acceptances. C. Commercial paper. d. Broker's calls 8. Which of the following statements are true regarding taxation of Treasury notes and bonds? a. Notes and bonds are taxed differently than T-bills b. Original issue discount tax rules apply. Interest income and capital gains are exempt from state and local taxes d. Interest income and capital gains are exempt from federal taxes. 9. Which of the following would protect an investor from exchange rate risk? a Global mutual funds. h. Yankee bonds C American depository receipts. Foreign pay bonds. 10. Which of the following types of municipal bonds have the greatest risk of default? a A general obligation bond from a state. b. A revenue bond. CA dedicated bond. d. A general obligation bond of a city. 11. Which of the following is not correct about TIPS? a The interest paid on TIPS changes based on inflation and the changing principal amount of the TIPS. b TIPS can be purchased on a competitive or noncompetitive basis. C.TIPS have maturities that do not exceed 20 years. d If deflation occurs over the life of the TIPS, then the investor receives the greater of the principal amount or the par value

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